Forming the Government of National Unity GNU was good for the Rand and the markets this week and all eyes, including those of investors, are now on the new cabinet that will hopefully be announced soon.
Investors are interested in who will run the show and make the policy that will make it easier or more difficult to do business in South Africa.
Lisette IJssel de Schepper, chief economist at the Bureau for Economic Research at Stellenbosch University, says after some hesitant gains ahead of the election and then struggling to find direction, markets piled into South African assets this week.
Positive local economic data played along and global dynamics did not derail the optimism towards South Africa. The Rand strengthened below R18/ for the first time since August 2023, stocks surged and bond yields declined which is a good thing amid strong demand for local bonds.
Long may it last, but the keenly anticipated announcement of the cabinet will be pivotal in determining sentiment going forward, at least in the near term, said De Schepper.
